Becoming rich

August 24, 2014

A recent letter to the editor claimed, without providing any supporting evidence: "When you give poor people money, they will spend it and still be poor." I beg to differ!

Here is a list of billionaires who started out poor, taken from a Jan. 1 article in Business Insider:

Kenny Troutt, the founder of Excel Communications, paid his way through college by selling life insurance. Net worth: $1.7 billion (as of Sept. 2013). Troutt grew up with a bartender dad and paid for his own tuition at Southern Illinois University by selling life insurance.

Starbucks' Howard Schultz grew up in a housing complex for the poor. Net worth: $2 billion (as of Sept. 2013). Schultz ended up winning a football scholarship to the University of Northern Michigan and went to work for Xerox after graduation. Shortly after, he took over a coffee shop called Starbucks, which at the time had only 60 shops. Schultz became the company's CEO in 1987 and grew the coffee chain to more than 16,000 outlets worldwide.

Investor Ken Langone's parents worked as a plumber and cafeteria worker. Net worth: $2.1 billion (as of Sept. 2013). To help pay for Langone's school at Bucknell University, he worked odd jobs and his parents mortgaged their home.

Born into poverty, Oprah Winfrey became the first African American TV correspondent in Nashville. Net worth: $2.9 billion (as of Sept. 2013). Winfrey was born into a poor family in Mississippi, but this didn't stop her from winning a scholarship to Tennessee State University and becoming the first African American TV correspondent in the state at the age of 19.

What, if anything, do these incredibly-rich individuals have in common? It's education! If you give an individual a good education, he or she will have the tools needed to make headway in our increasingly-complex society.

If you want to help a person get out of poverty, send him or her to school. A job may last for a couple of years, or until it is outsourced to a worker in some foreign land where wages are so low that no amount of effort on the part of the worker here could even the score. An education, by contrast, lasts forever.

If as a society we provide any given needy person with the supports and services needed to get an education, we will have much less to worry about from that person in the future. Putting a person in jail costs upwards of $60,000/yr. and, after all that, what do you get? Most likely a more skilled criminal who can't get a job. Providing that same person with an education costs much less, and the outcome is, well, so much better!